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In the Middle With You

An excerpt from Direct: The Rise of the Middleman Economy and the Power of Going to the Source

Walmart and Amazon are the two biggest companies in the country. Many of us have become so accustomed to relying on Amazon or Walmart that we take their size and omnipresence for granted. But there is much more to the rise of these giant middlemen, and the supply chains behind them, than meets the eye. They are just the most vivid examples of a much broader transformation in how the economy works, for whom it works and where the real power now lies.

In my book, Direct: The Rise of the Middleman Economy and the Power of Going to the Source, I explain the rise of the “middleman economy”—characterized by powerful middlemen and long supply chains. The book weaves together data, stories, and theory to show how the middleman economy took hold, the benefits it brings and the dangers it poses. By comparing today’s middleman economy with the very different ecosystem that grows out of direct exchange—between makers and consumers, investors and entrepreneurs—the book shows how much is at stake in the threshold issue of “through whom” we buy, invest and even give. It demonstrates how increasing direct exchange and more modest shifts in that direction can help us lead richer lives and contribute to a more resilient, connected and just economy.

Direct exchange and its kin are proliferating, for reasons both profound and practical. As the drawbacks of trying to navigate the middleman economy grow, so too do the benefits of finding a way around it. There has been an increase in true direct exchange, embodied in farmers’ markets, creators selling homemade goods via their own websites and comic cons replete with small-production graphic novelists hawking their wares. There has also been a proliferation of close cousins, including digital platforms such as GoFundMe, Etsy and Kickstarter, and producers that bypass traditional middlemen, such as Warby Parker, Allbirds and other direct-to-consumer companies. In providing consumers, investors, workers, entrepreneurs and all of us as humans, an outside option, the rise of direct exchange can go a long way in shifting the balance of power even in a world still full of middlemen. Middlemen are not the enemy. The middleman economy is.

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